Lodi residents to pay less for water meters

Thursday

Oct 21, 2010 at 12:01 AM

LODI - The cost for the city to build a water treatment plant near Lodi Lake keeps getting cheaper, and the result for residents is a $900 price reduction for the installation of water meters at their homes.

Keith Reid

LODI - The cost for the city to build a water treatment plant near Lodi Lake keeps getting cheaper, and the result for residents is a $900 price reduction for the installation of water meters at their homes.

The City Council on Wednesday night approved contracts to build the $23 million facility and to purchase a $3 million water filtration system to cleanse the Mokelumne River water Lodi purchases from the Woodbridge Irrigation District.

"We've been working on this project for a long time, and all the delays, all the debates, have led us to the perfect time to start this project," City Councilman Larry Hansen said. "Our bond ratings are high, the bid market has been better than it has been in years. This is the best time to go forward with this."

Councilwomen Susan Hitchcock and Joanne Mounce have opposed the water treatment plant, both favoring recharging the city's groundwater table. Hitchcock has also been starkly opposed to paying for a plant that will be used mostly to serve new development.

"We don't need this plant for the current population," she said, disagreeing with Hansen on timeliness.

As the project has unfolded, however, the city has found millions in savings.

First, the $23 million bid for construction, which comes from the C. Overaa & Co. of Richmond, came in $6 million below original projections.

Secondly, the sale of bonds that are being used to finance the water treatment plant went very well Tuesday, city officials said.

The bonds sold at a 4.07 percent interest rate, saving the city more than $300,000 a year in its projected debt service. Bond consultants estimated the city would need to repay the bonds at $2.6 million a year. Instead, it will need to pay$2.3 million a year over 30 years.

"It priced out better than we thought, and that means less debt service, so that's great. Anytime you can save money in this economy, you take it," Councilman Bob Johnson said.

The reduced debt, along with a 2 percent increase in water fees the council approved in July, means the city can afford to pick up the tab for infrastructure and installation costs of state-mandated water meters at each home in Lodi.

The council on Wednesday approved a plan that will charge residents $300 for the meter, a steep discount from a previous price tag of up to $1,200 for residents who needed new pipes installed or relocated during meter installation.

Residents who already have installed meters at a price higher than $300 can request a refund.

"The city's expenditure is about $6 million," city engineer Wally Sandelin said.

With the change in pricing, the city will also extend the time frame to complete meter installations from 2015 to 2017.

Residents will be allowed to finance their $300 meters over three years, at $8.53 a month.

"I'm so glad (the city) found a way to make residents only feel the impact of $300 for a water meter," Mounce said. "I'm so glad we've listened to the residents of this city."